Macro Doubts - Help !!!!!

[Anjali]

1. Which of the following statements would a macroeconomist who embraces the rational expectations/neoliberal paradigm accept as an appropriate assumption?   a) The whole is exactly equal to the sum of its parts. c) Investors and innovators always behave rationally.  b) A macroeconomic model must be based on a logical set of microfoundations. d)  All are right.      

2. According to Friedman, if the stock market rises rapidly in value, the:   a) demand for money will increase. c) demand for money will be unaffected.  b) demand for money will decrease. d) marginal propensity to consume will decrease.    

 3. The circular flow of income for a private sector model shows   a) the flow of income between the household and the business sectors c) the flow of income between household, business and government sector.  b) the flow of income between government and business sector d) the flow of income between government and household sector.  

4. Which of the following factors will NOT shift the consumption schedule?  a) income c) family debt  b) wealth of a family d) expectations about future prices and income

5. Weak home currency may not be a perfect solution to correct a balance of trade deficit because:
   a) it reduces the prices of imports paid by local companies. c) it prevents international trade transactions from being prearranged.  b) it increases the prices of exports by local companies. d) foreign companies may reduce the prices of their products to stay competitive

[mrittik]

I think abt the below answers:

1.d. 2.d(not sure) 3.a 4. c (not sure)

[Anjali]

Thanks mrittik ! Others plz give your consent !

[Anjali]

Also plz try this one !

 Which of the following will cause the money multiplier to become smaller?
A) an increase in high powered money
B) a decrease in the ratio of reserves to checkable deposits
C) an increase in the public's preference for checking deposits as opposed to holding currency
D) a reduction in high powered money
E) none of the above

[mrittik]

an increase in high-powered money means base money in economy is increased for that reason tightening the monetary policy which turns to reduce the marginal propensity to consume, so the money-multiplier is decreased.

[Anjali]

But the ans is E